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New Points Based Immigration System: Is Your Business Eligible To Apply For A Sponsor Licence?

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Applying for a Home Office sponsor licence may be on your "to do" list but with Brexit, the end of free movement and the introduction of the new points based Immigration system on the 1 January 2021, you may be thinking what is the rush? After all, why not see how things go and apply in January 2021? Sponsor licence solicitors say the best advice is to carry out a detailed strategic Brexit review now. If your review concludes that your business will need a Sponsor Licence after the end of free movement and the introduction of the new points based Immigration system, then you should apply for a sponsor licence now. In this blog we look at the steps businesses need to take to check their eligibility to apply for a Sponsor Licence.

Sponsor Licence solicitors

If you don’t know whether your business needs to apply for a Home Office sponsor licence or if you need help with making your first Sponsor Licence application then call our specialist sponsor licence solicitors on 0203 959 9123 or complete our online enquiry form.

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When should my business apply for a Sponsor Licence?

At the moment you only need a Home Office Sponsor Licence if your business wants to employ non-EEA nationals. The Home Office approved sponsor licence enables your business to sponsor non-EEA nationals who apply for a Tier 2 (General) visa or Tier 2 Tier 2 Intra Company Transfer visa or a Tier 5 visa from the Home Office after your business has assigned them a Certificate of Sponsorship under your firm’s Sponsor Licence.

You may think that your business doesn’t have the sort of business profile that needs to obtain a Sponsor Licence as your workforce is either small or consists almost entirely of UK or settled workers or EU citizens. If time stood still you may be right; your business may not need a Sponsor Licence. However, inevitably your current workforce will retire or leave or your business will have new job vacancies, either as a result of expansion or different work processes and new workforce skill requirements.

With the end of free movement you won't be able to recruit EU citizens who don’t have settled status or pre-settled status under the EU Settlement Scheme without a Sponsor Licence. Waiting until you need to recruit means your pool of potential recruits will be limited to:

As other firms won't necessarily have thought ahead and secured their first Sponsor Licence you will be trying to recruit in a very competitive recruitment market and, depending on the nature of your business, may face a skills gap and delays in recruitment.

Applying for your first sponsor licence now may feel too early but if you don’t take action now you may find that when you want to recruit you can't employ the worker/s you need in the timescale your business requires. That is because you’ll need to apply for your first Sponsor Licence and the Home Office may be slow in dealing with applications because of the post January 2021 surge in demand.

You may think that the Home Office won't want early applications but the Home Office guidance for employers applying for a Sponsor Licence specifically refers to employers being able to base their sponsor licence application based on future Employment needs after January 2021 and the implementation of the new points based Immigration system and revised qualification levels for Tier 2 (General) visa applicants.

Applying for a Sponsor Licence

Sponsor licence solicitors say that before you apply for a Sponsor Licence it is essential that you assess the type of Sponsor Licence your business requires and check that your business meets the eligibility criteria for a Sponsor Licence.

What type of Sponsor Licence does my business need?

The Home Office Sponsor Licence type that your business requires is dependent on:

  • The nature of your business

  • Your potential job vacancies

  • The skill level required.

There are two tiers of visa that require sponsorship by the holder of a Home Office sponsor licence, namely:

  • Tier 2 - skilled workers with long-term job offers. The tier is split into four sub-categories

  • Tier 5 - skilled temporary workers. The tier is split into five sub-categories.

Your business can apply for a sponsoring licence covering Tier 2 or Tier 5 or both tiers. If you are not sure whether your business needs a Sponsor Licence to cover both tiers it is best to take Immigration law advice on your specific Sponsor Licence needs.

What does a Tier 2 Sponsor Licence cover?

With a Tier 2 sponsor licence your business will be able to sponsor and provide Certificates of Sponsorship to skilled workers who you want as long-term employees. The four sub-categories of the Tier 2 visa are:

  • General – the sponsored employee needs to meet the relevant job criteria and points under the points based Immigration system

  • Intra-Company Transfer - for multi-national companies who want to transfer an overseas based employee to the UK branch of the multi-national company

  • Minister of Religion - for people coming to work for a religious organisation

  • Sportsperson - for high level sportspeople and coaches.

The vast majority of business owners need a Sponsor Licence to sponsor Tier 2 (General) visa workers but you may also need a Sponsor Licence in case you want to transfer employees under a Tier 2 Intra Company Transfer visa.

What does a Tier 5 Sponsor Licence cover?

With a Tier 5 sponsor licence your business can recruit temporary skilled workers. The tier is split into five sub-categories:

  • Creative and Sporting - to employ a sportsperson for up to one year or to employ an entertainer or an artist for up to two years

  • Unpaid charity worker employed for up to one year

  • Religious worker employed for up to two years

  • Government authorised exchange worker – the visa can last for one or two years depending on the area of work experience

  • International agreement worker such as the employee of an overseas government.

Your business may need other temporary workers so it is best to take legal advice on your Immigration and Employment requirements as, for example, there is a specific temporary visa category for agricultural workers.

Does my business meet the eligibility criteria for a Sponsor Licence?

The eligibility criteria for your business to able to apply for a Home Office Sponsor Licence is pretty basic. The main reason the Home Office will refuse a Sponsor Licence application is if the granting of a Sponsor Licence is thought to be a risk to Immigration control.

Detailed guidance is contained in Annex 2 to the updated April 2020 Guidance to employers on applying for a Home Office Sponsor Licence but in summary the Home Office will refuse a Sponsor Licence application if:

  • There has been any previous record of non-compliance or poor compliance with the duties of sponsorship or with the work permit arrangements

  • Previous requests for evidence to enable the Home Office to decide whether the business was complying with the sponsorship or work visa arrangements have not been provided

  • If the business or an individual (employed as key personnel in a previous job) has had Sponsor Licence authorisation removed (this emphasises the importance of choosing your Sponsor Licence key personnel with care)

  • The business has knowingly provided a false statement or false information, or not provided information held when required by the Home Office or other Government Department

  • A member of the Sponsor Licence key personnel team has been involved in a similar role in a previous Sponsor Licence business where within the last five years the business was issued with a penalty for failure to pay VAT or duty

  • Key personnel have any unspent conviction for an Immigration offence or a criminal offence which the Home Office considers is of relevance to the discharge of Sponsor Licence duties

  • If the business has been issued with more than one civil penalty in the five year period immediately prior to the Sponsor Licence application for employing illegal workers

  • An owner, director or the authorising officer of the business has been issued with a civil penalty in the five year period prior to the Sponsor Licence application for authorising the granting of a residential tenancy agreement to a person who is disqualified because of their Immigration status (in other words not complying with the right to rent checks and controls)

  • A member of the key personnel has previously held a key personnel role at a business whose Sponsorship Licence has been revoked in any tier within the last twelve months

  • A business owner, director or authorising officer of a Sponsor Licence applicant has been previously ordered to pay costs to the Home Office in any legal proceedings and the costs have not been paid.

Although there is focus on the business owner, director and key personnel in the above list, Sponsor licence solicitors say that the Home Office can (but don’t routinely) carry out checks on other individuals within the business , such as a decision maker or a senior employee. If a senior employee’s past conduct or history raises concerns with the Home Office then the Immigration Rules say the Home Office may ask the business for information on the employee as part of the Sponsor Licence application process. The conduct of the senior employer, where relevant, may also be taken into account in deciding what action to take.

If you are concerned that you, your business or a member of the planned key personnel or a senior employee may fall foul of any of the above criteria it is best to take legal advice from Sponsor Licence solicitors before either raising matters with your senior employee or submitting your Sponsor Licence application.

You should not think that just because your business may have had a historical issue with the Home Office or another government department or as a member of your key personnel had issues with their Sponsor Licence duties whilst working for a previous employer it will rule you out as being eligible to secure a Sponsor Licence.

Will the Home Office automatically refuse a Sponsor Licence application if I don’t meet the eligibility criteria?

Many business owners and directors have historically been put off from applying to the Home Office for a sponsor licence because of the eligibility criteria and a fear that their ‘past history’ will result in Sponsor Licence application failure. With the end of free movement and the drying up of the availability of EU nationals as a source of overseas workers able to meet the UK skills gap without needing a Tier 2 (General) visa , it is now more important than ever to sort out your Sponsor Licence application and overcome any hurdles.

Sponsor licence solicitors say that many of the matters on the list of potential reasons for the refusal of a Sponsor Licence application may not result in an automatic rejection but instead the Home Office will look at:

  • The seriousness of the past conduct (including conduct that led to revocation of a sponsor licence)

  • What the business has done to improve the situation

  • How long has elapsed since the conduct took place

  • The mitigating circumstances

  • The concerns the Home Office has about any associated persons or employees, and the role they currently have within the business given any past Sponsor Licence abuse or revocation with a previous employer

  • Whether the Home Office considers a previous criminal conduct has a bearing on the suitability of the business to hold a Sponsor Licence.

The message that Sponsor Licence solicitors want to give is that even if you are wary or cautious about applying for a Sponsor Licence as you fear not meeting the eligibility criteria it is best to take legal advice on your end of free movement recruitment options and the securing of a Sponsor Licence.

UK Sponsor Licence solicitors

Whether this is your first application for a sponsor licence, or if you have had a previous Sponsor Licence application refused, now is the time to apply to the Home Office for your Sponsor Licence so that you are ready for the end of free movement and the new points based Immigration system.

OTS Solicitors specialise in business immigration and personal immigration law and are recommended in the two leading law directories, The Legal 500 and Chambers Guide to the Legal Profession. The specialist lawyers offer fast, efficient, easy to follow immigration and employment law advice looking at your best Brexit options and follow-up advice and legal services from applying for a sponsor licence, sponsor licence management services, settled status one day application service for existing EU citizen employees and HR staff training on sponsor licence compliance and reporting duties.

For expert immigration and employment law advice that you can trust, call the Sponsor Licence lawyers at OTS Solicitors on 0203 959 9123 or contact us here.

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